...Insurance fraud occurs when any act is committed with the intent to fraudulently obtain some benefit or advantage to which they are not otherwise entitled to. Health insurance Fraud is becoming one of the top forms of fraud in America. Insurance fraud cost Americans billions of dollars every year as well as higher premiums. It is viewed as mostly a white-collar crime but it can come in many different forms. People who usually commit these kinds of frauds are motivated by greed for necessity or seeking wealth and luxury. There are several ways that healthcare companies are committing health insurance fraud. Examples of healthcare fraud include billing for services or supplies that were not provided, or billing Medicare for missed patient appointments, and altering CMS claim forms for higher payment amounts.. A successful prosecution of a health care provider that ends in a conviction can have serious consequences. The health care provider faces incarceration, fines, and possibly losing the right to practice in the medical industry. In Florida, it was reported that a physician was sentenced to 24 months incarceration and ordered to pay $727,000 in restitution fees for signing blank prescriptions and certificates of medical necessity for patients he never saw (Rudman, 2009). This is an example of the criminal liability that can result from healthcare fraud. In the case United States ex rel. Donigian v. St. Jude Medical agreed to pay $16 million to quiet allegations of paying...
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...HEALTH CARE: SHOW ME THE MONEY By defining health-care fraud, observers should be aware that hard-earned money is wasted annually. Consequently, more precautions should be enforced to safeguard citizens’ tax dollars. Simply put, health-care fraud is the submission of false claims by individuals acting with disregard to the truth (Lovitky, 1997). Individuals, empowered to be health care providers, can be guilty of committing health care fraud, as well as major corporations (Sparrow, 1996). According to former Attorney General of the United States, Janet Reno, states health-care fraud ranks second of the top priorities of the Department of Justice, just behind narcotics interdiction (Lovitky, 1997). Health-care fraud typically involves violations by way of: overutilization; up coding; billing for services not provided; failing to provide necessary services; and filing false cost reports (Lovitky, 1997). Fundamentally, overutilization is defined as providing medical services not needed or required. In the process of overutilization, fraud takes place when more services are provided than what the situation calls for, or when medical services are never performed and still billed to the insurance company (Lovitky, 1997). Up coding, according to Lovitky (1997), involves Current Procedure Terminology (CPT). The CPT code accurately describes medical, surgical, and diagnostic services and it is designed to make medical services and procedures consistent among physicians, coders...
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...Abstract. Heath care fraud is a type of white-collar crime that involves the filing of dishonest health care claims in order to turn a profit. Health care schemes come in many different forms like: billing by practitioners for care that they never rendered, filing duplicate claims for the same service rendered, altering the dates, description of services, or identities of members or providers, modifying medical records, intentional incorrect reporting of diagnoses or procedures to maximize payment, prescribing additional or unnecessary treatment. In this paper, I will examine the Multi-Million-Dollar Health Care fraud that was committed by one surgeon, who worked in NY hospital. I will also apply the fraud triangle and go over detection and prevention steps. Introduction. Spyros Panos was a board certified orthopedic surgeon licensed to practice medicine in the State of New York. Between 2006 to 2011, Panos performed a huge amount of orthopedic procedures that helped him to make lots of money from his fraud schemes. He had back-to-back surgeries and had 12-hour surgery days. Most of the time Panos had two patients under anesthesia at the same time. He performed short operations and some of them were seven minutes long. (Nina Schutzman, 2014). The records showed the times of surgeries and administering of anesthesia but did not contain a description of the procedures or names of patients. Panos high volume of surgeries a day raised a red flag and his...
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...Health care Fraud Health care fraud is a crime that has a significant effect on the private and public health care payment system. According to the Federal Bureau of Investigation, all health care programs are subject to fraud with Medicare and Medicaid being the most visible. It is estimated that fraudulent billings to both private and public health care programs are between 3 and 10 percent of total health care programs expenditures. The most recent Centers for Medicare and Medicaid (CMS) statistical estimates project that total health care expenditures are estimated to total $2.4 trillion, representing 14 percent of the gross domestic product. By the year 2016, CMS also estimates that by the year 2016, the total health care spending is to exceed $4.14 trillion, representing 19.6 percent of the GDP. As one can see, the tens of billions of dollars lost due to health care fraud is a serious financial issue that affects the healthcare system as a whole and affects patients, taxpayers, and government through higher health care costs, insurance premiums and taxes. Health care fraud is defined in Title 18, United States Code (U.S.C) s. 1347 as “whoever knowing and willfully executes or attempts to execute a scheme or artifice to defraud any health care benefit program or to obtain, by means of false or fraudulent pretenses, representations or promises, any money or property owned by or under the custody or control of, any health care benefit program.” In other words, it is intentional...
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...White Collar Crime Principles and Theory of Securities Management For: Professor Leiman By: Jaime Gwidt June 25th, 2016 Introduction This paper will cover the security crimes of credit card and health care fraud. It will discuss how these crimes are committed, their impacts on organizations and the tools a security professional has available to reduce opportunities for such crimes to occur. It will also cover an example of how credit card fraud was discovered and discuss possible measures that could have deterred those found guilty. Credit Card Fraud Credit card fraud occurs “when consumers give their credit card number to unfamiliar individuals, when cards are lost or stolen, when mail is diverted from the intended recipient and taken by criminals, or when employees of a business copy the cards or card numbers of a cardholder” (Chase, 2016). Credit card fraud is discovered by recognizing a break in spending patterns. An example would be if you live in one area of the US and you have charges happening in another part of the states, that may tip the scales in favor of possible fraud, and your credit card company might decline the charges and ask you to verify them. Businesses and organizations are negatively impacted by credit card fraud. Small business is most negatively impacted. Targets won’t be happy about the massive losses, but small businesspeople can get destroyed. If fraudsters charge up a storm on stolen card data with a given merchant, and that merchant...
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...Reporting Practices and Ethics Paper Jessy Dominique-Clark HCS/405 Health Care Financial Accounting September 24, 2013 Debra Brindley Reporting Practices and Ethics Paper The National Health Care Anti-Fraud Association assess that the economic damages cause by health care fraud is more than ten of billon dollars every year. Financial controlling is difficult, but by using the four fundamentals of monetary management correctly and following the generally accepted accounting principles, revealing the financial position of an organization is not difficult ("The Challenge of Health Care Fraud", 2012). The four fundamentals of monetary management are controlling, decision-making, organizing, and planning. Controlling entails ensuring that every area of the organization is adhering to the plans that have been established. The decision-making process entails making an educated choice. Organizing entails using the organizations resources to successfully carry out the plans that have been established. The process of planning is to compile goals of the organization and then to identify the steps necessary for achieving these goals. The financial management team is accountable for ensuring the reports are up-to-date, and they are accountable for reporting the funds with the principles set forth by the code of ethics and mission statement of the organization. Every organization has the obligation and wants the veracity to release the correct financial position to its stakeholders...
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...Medicare Fraud: The History, Incidence, Costs and Institutional Remedies INTRODUCTION In 1965, President Lyndon B. Johnson signed the Medicare Act into law. The purpose was to provide healthcare to individuals the age of 65 or older or individuals under the age of 65 diagnosed with specific medical conditions (Center for Medicare and Medicaid Services, 2013). The original intent was to provide immediate payment to those providing medical services for the less fortunate. The Medicare Act has since been revised to meet the current needs of the American population as well as the United States economy. In part, these revisions included identifying, combating, establishing punishment (criminal laws) and prevention for Medicare Fraud. This paper will provide a brief overview of the Medicare fraud history, incidence, costs and institutional remedies. MEDICARE FRAUD: HISTORY AND DEFINITION Fraudulent activities against the government were first addressed during the Civil War. The False Claims Act (qui tam statute), also known as the Lincoln Act, was passed during this time frame. The intent was to prevent the Union Army from being a victim of supplier fraud. Citizens were given, “the ability to file suits on behalf of the US government whenever they spotted fraud” (Medicare Fraud Center, 2015). The citizens were rewarded with a portion of the monetary fines (issued to the defendant) for addressing the crime. Currently, similar rewards remain in effect for reporting Medicare...
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...unsustainable growth in health care costs, there is general agreement on the need to eliminate unnecessary spending in health care--and among the leading candidates are fraud and abuse. Despite ongoing, concerted efforts, making meaningful inroads has not been easy."Fraud" refers to illegal activities in which someone gets something of value without having to pay for it or earn it, such as kickbacks or billing for services that were not provided. "Abuse" occurs when a provider or supplier bends rules or doesn't follow good medical practices, resulting in unnecessary costs or improper payments. Examples include the over-use of services or the providing of unnecessary tests. (Another area, "waste," refers to health care that is not effective, and will be the subject of a separate Health Policy Brief.)Endowed with new powers under the Affordable Care Act and the Small Business Jobs Act of 2010, the Centers for Medicare and Medicaid Services (CMS) has been adopting new tools to curb fraud and abuse in the Medicare and Medicaid programs. The new approach amounts to a paradigm shift from the earlier model, in which CMS paid providers first, then sought to chase down fraud and abuse after the fact--a process known as "pay and chase."This policy brief focuses on eliminating fraud and abuse in Medicare and Medicaid and explores the challenges involved in putting the new tools into place. | What's the background? | The true annual cost of fraud and abuse in health care is not known. In fiscal...
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...Reporting Practices and Ethics Paper HCS405 July 29, 2012 Professor C. Brew Reporting Practices and Ethics Paper Financial accounting and financial management are the basis for health care accounting. The GAAP is a cornerstone of all accounting practices. Financial management aides and guides health care accounting practices in today’s health care settings. These two elements are the building blocks for a solid health care organization. Without the two, there is risk of fraud and unethical practices within health care. In financial accounting there are four elements of financial management. The first element is planning. In the planning element of financial management, the objective is determined and then the steps needed to reach that objective are identified so that the goal of accomplishing the objective can be met. The second element of financial management is controlling. In controlling the goals set in the planning element are monitored to ensure that the goal is on track. In the controlling stage of planning, managers use reports to track the goals, compare information and to gain feedback on the status of the goals. Organizing and directing is the third financial management element. In this element the manager works daily to track the progress of the goals, reviews daily the results of the organizing and is active daily in the progress of the goals. The final element of financial management is decision making. In the decision making element the financial...
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...Assignment 2: Accounting and Audit Enforcement ACC 599 – Graduate Accounting Capstone QUESTION #1 After so many scandals in regards to financial frauds, Sarbanes-Oxley Act Section 404 mandates that all publicly-traded companies must establish internal controls and procedures for financial reporting and must document, test and maintain those controls and procedures to ensure their effectiveness. Non-for-profit healthcare organizations do not hold themselves to the same standards as the for-profit organizations. Although whether SOX guidelines apply to businesses in the healthcare industry depends on whether the business is a for-profit or non-for-profit organization, some voluntarily adopt SOX in an effort to strengthen internal management controls and increase the quality of healthcare financial reporting (Lohrey, n.d., ¶1). Non-for-profit organizations could certainly benefit from the SOX Section 404 to help reduce the possibilities of corporate fraud by increasing the stringency of procedures and requirements for financial reporting. Many health care executives and board members have concluded that SOX created a new benchmark for best practices, as well as provided extra protection from liability by evidencing direct board attention and oversight of organization compliance (Kusserow, 2013, ¶1). Without audit committees, non-for-profit organizations are at higher risk of financial disaster. Following the SOX compliances can be very beneficial for the non-for-profit...
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...new trends affecting today’s payment methods for long term healthcare services which is making the United States Health Care system ever more complicated. Long term health care today is considered a reimbursement driven industry (Casto, 2006) . The term reimbursement refers to repayment or compensation of health care services (Bowman, 2007). Reimbursement is the process of being repaid for services that have already been given (Casto, 2006). In long term care, services are often provided prior to payment being made. Since patients have already received treatment, the facility, practitioners, and their staff seek reimbursement to cover those expenses such as medications, procedures, and supplies (Bowman, 2007). Generally a physician, health care organization, or practitioner will submit an itemization of services, products, equipment, and supplies that have been rendered (Casto, 2006). This is known as a claim (Casto, 2006). The claim lists the fundamental characteristics of reimbursement such as fees and charges (Casto, 2006). These claims are reimbursed by one of two ways. An institution can be paid by a fixed amount called capitation (Casto, 2006). A capitated amount is what is paid regardless of the number or costs of health care services provided (Bowman, 2007). This often gives providers incentive to lower costs and to focus more on preventive care (Bowman, 2007). Fee for Service is another method of reimbursement. This is paid based on a set fee for each service...
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...Reporting Practices and Ethics HCS/405 Introduction Planning, controlling, organizing and decision making make up the four elements of financial management Baker (2011). Standards and guidelines of financial reporting are known as generally accepted accounting principles (GAAP) ("Accounting Principles & General Financial Ethical Standards", 2014). Financial ethics and standards determine the success of an organization. The VA is accused of the death of over 1000 waiting for care and budget mismanagement (“Bad VA care may have killed more than 1,000 veterans, senator's report says,” 2014). The alleged deaths could have been avoided through the use of GAAP. The FBI has uncovered millions of Medicare fraud rings (“More Than 20 People Arrested Following Investigations into Widespread Health Care Fraud in D.C. Medicaid Program ” 2014,). The Four Elements of Financial Management According to Baker (2011), the four elements of financial management are: planning, controlling, organizing and decision making. Planning is the stage of identifying the organizations objectives and steps to obtain the objectives. Controlling allows management to measure data from previous and current reports to determine changes within the organization as needed. Organizing is the stage in which management coordinates each aspect of the plan, such as; who, what, when and where. Decision making is management’s final role in making an educated decision based on the other four elements of financial...
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...Reporting Practice and Ethics HCS/405 Health Care Financial Accounting June 29, 2015 In order to function properly, every company or organization should have a financial plan in place. Health care organizations are part of the service industry and are no exception and cannot successfully operate without proper financial management. Financial management involves the managing of organizational funds in order to meet organizational goals and plays an important role in helping organizations work more effectively. According to Hicks (n.d.), “within accounting and financial management, there are four key elements recognized. The four elements are: Planning, Controlling, Organizing and Directing and Decision Making.” As with all other organizations, health care organizations must follow general ethical standards of conduct and financial reporting practices known as the General Accepted Accounting Principles (GAAP). The four elements of financial planning are set in place to help the financial process operate properly. The purpose of each of these tasks is as follows: * Planning - helps identify the organizational needs and objectives as well as the steps necessary to meet these needs; * Controlling – involves comparing current and past reports or feedback in order to determine if any area of the organization is ineffective or simply needs help. Controlling also ensures that the plans set in place during the planning process are being followed. * Organizing and directing...
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... | |Health Care Fraud and Abuse | | | | | |Tannisia Brown | |6/17/2012 | | | Health care fraud is the filing of dishonest health care claims to obtain a profit and is considered a white collar crime. Health care abuse is when someone overuses or misuse services. Both, Health care fraud and abuse, in the United States is an ongoing issue and is costing the United States government billions of dollars. Every time a fraudulent act is perpetrated the insurance company passes the cost to its customers. Due to the high volume of health care fraud statistics shows that 10 cents to every dollar spent on health care goes toward paying fraudulent health care claims. The...
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...Reporting Practices and Ethics xxxxxxxxx HCS/490 – Health Care Consumer: Trends and Marketing June 21, 2016 Professor Jack Heinen Financial management is a critical part of running and operating any business, and the health care industry is no different. In order for any health care industry to remain profitable and financially organized, it is extremely important for them to have someone designated to make sure that the finances are always current and monitored. It is also crucial that the organization utilizes the four elements of financial management. The four elements include planning, controlling, directing and organizing, and decision-making. Almost every industry that collects revenue sees some kind of financial fraud or abuse, and in the health care industry this has happened in many different ways. Making sure that there are accounting principles and ethical standards in place are an important way to try to avoid such chaos. The four elements of financial management are critical tools to help the financial manager keep a close eye on the finances from the start of a project to the very end. Planning is always the first element or step, and after assessing the business, the financial manager creates goals and objectives, based on the aims of the business. When making the plan, the financial manager will include the necessary steps to get there, what that will entail, and the end goal. Controlling is the...
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